Introduction to Trading Types Why Do Contracts Always Liquidate?

It's not bad luck; you simply don't understand the essence of trading! This article, distilled from ten years of trading experience, presents low-risk principles that will completely overturn your understanding of contract trading — liquidation is never the market's fault, but rather a time bomb you've set for yourself.

Three Major Truths that Disrupt Common Understanding

Leverage ≠ Risk: Position Size is the Lifeline

Using 1% position size with 100x leverage, the actual risk is only equivalent to 1% of a full spot position. A certain student used 20x leverage on ETH, investing only 2% of the principal each time, and has a record of three years without liquidation. Core formula: Real Risk = Leverage Factor × Position Ratio.

Stop Loss ≠ Loss: The Ultimate Insurance for Your Account

During the 312 crash in 2024, 78% of the liquidated accounts shared a common characteristic: they failed to set stop losses even after losses exceeded 5%. A professional trader’s iron rule: a single loss must not exceed 2% of the principal, which is equivalent to setting a "circuit fuse" for the account.

Rolling Positions ≠ All-In: The Correct Way to Compound

Tiered Position Building Model: Start with a 10% trial position and use 10% of the profits to add to the position. With a principal of 50,000, the initial position is 5,000 (10x leverage), and for every 10% profit, add 500 to the position. When BTC rises from 75,000 to 82,500, the total position only expands by 10%, but the safety margin increases by 30%.